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The loyalty industry seems to be more active now than ever before and various factors play a multitude of roles.

Loyalty360 talked to Jarod Sutton, Business Solution Manager at Comarch, about this reality and his views on other loyalty trends.

Can you talk about how growing consumer expectations dictate trends in the loyalty industry?Sutton: Consumer’s buying patterns and preferences are a primary influencer when it comes to determining the loyalty industry landscape. Consumer expectations can be characterized as consumer wants and needs based on the perception of both consumption and brand interaction. Driving customer engagement and developing strategies to entice customer retention are all influenced by how the customer behaves and what they expect from their retailers. How loyalty providers stay relevant is constantly developing new technologies to meet the demands of consumers by providing retailers with state of the art tools to target and meet the expectations of consumers.

There is so much talk about experiential loyalty overtaking traditional, points-based programs. What are your views on this?Sutton: I think experiential loyalty is the way of the future and is to be expected from the customer’s standpoint moving forward. Often, for a tangible reward that is truly valuable to the customer, there is a high point value associated in earning that reward, that equates to high spending and lengthy periods of time before the point threshold has been met to redeem. These tangible rewards can be outdated soon after redemption as many of the products redeemed are technology based or simply don’t tie the redemption back to the brand. With experiential loyalty, whether it be a movie premiere, vacation, or restaurant experience, all of the customer’s senses are engaged and memories are established. Every time they have a similar experience or remember back to that same experience they are reminded of how they were able to create that memory. That’s how I believe you solidify and retain loyal customers. Create circumstances and experiences that customers can reference for a lifetime to influence consistent purchasing behavior.

Can you talk about trends in customer loyalty that you foresee for 2018 and beyond?Sutton: AI in general is shaping the loyalty landscape, but more specifically, I see AI driven chatbots as a functionality to become more commonplace in loyalty programs. I don’t see the technology as a means for replacing humans from a customer service perspective, because the technology hasn’t matured to the point to provide reasonable assistance for customer’s more complicated inquiries. AI chatbots will embellish a customer’s overall service experience for more simplistic tasks, such as password resets, ordering operations, or store location assistance. The positive is this service can be available at all hours, regardless of time zone differences, which increases customer’s satisfaction and encourages future interactions with the brand. The true takeaway is that AI technology is a trend that will grow and develop to predict customer behavior.

What factors are contributing to many of these trends?Sutton: The most influential contributing factor is the shared interest for companies and organizations to move toward a more automated approach of doing business. If there’s a way to automate a process and reduce cost without sacrificing quality, companies are more willing to make an investment. On the other side, customers are the ultimate driving forces for change. As customer’s demands increase and expectations for real-time results heighten, there is a greater need to automate and implement AI technologies to be more predictive rather than reactive.

What are loyalty marketers doing well now and what are their main challenges?Sutton: Loyalty marketers are simplifying their programs, not by offering less to their customers, but rather providing a program that is easy to participate in, understand, and a seamless redeeming experience. These factors reduce attrition and encourage customers to stay with a loyalty program because being a member of the program doesn’t result in added hassle to their normal shopping experience. To go along with the ease of use of a program, marketers are including mobile apps into their offerings, which not only brings them closer to the customer for personal gain but allows for the customer to be more engaged in the program with real-time updates on order status or hotel reservations. Marketers are catering to the customer and ensuring a consistent experience across their loyalty program. A common challenge providers face is developing processes and procedures to digest all the customer data they receive from their program. Data is one of the most important and valuable output from a loyalty program, so understanding how to leverage that data to enhance their program is a tall task.